GEORGE JOHNSON & COMPANY
Dear Clients and Friends,
The questions relate to a host of topics, some of which are discussed below under “Detail.” They include: Accounting Standards Codification (ASC) 730; certain software development activities; certified audited financial statements; the Directive and its Appendices; the ways in which the Directive interacts with other IRC sections; substantiation; audit steps under the Directive; and penalties.
The FAQs explain that the Directive does not “determine as a matter of law” that ASC 730 research activities are Research-Credit qualified activities. Instead, its purpose is only to improve the efficiency of Research-Credit examinations, not to establish legally conclusive presumptions.
For further guidance, taxpayers should review the Directive itself, along with the Practice Units recently released by the IRS.
IRS Offers Limited Relief to Certain Taxpayers Subject to the Section 965 Transition Tax
Section 965 generally imposes a transition tax on untaxed foreign earnings of certain foreign corporations owned by U.S. shareholders by deeming those earnings to be repatriated. Taxpayers may elect to pay the Section 965 transition tax in installments over an eight-year period if the taxpayer files a timely election under Section 965(h).
The relief and additional guidance was detailed in three new questions and answers (Q&A) posted on the IRS’s updated Questions and Answers about Reporting Related to Section 965 on 2017 Tax Returns (the FAQ).
Join us in congratulating Michael Nicholas and Gloria Zhao on their tenure with GJC!
We are happy to share that our Quality Control Principal, Michael Nicholas is celebrating 32 years of service with George Johnson & Company. He joined GJC in 1986 and has been a Principal since 1994. Aside from being responsible for managing all facets of audits, reviews, other attestation engagements, and tax return preparation services for our clients, Mike also maintains our quality control standards. We are fortunate to have him on our team!
Luanne MacNichol – Director, Employee Benefit Plan Audit Practice, BDO USA LLP
Kim Flett – Compensation & Benefits Services Managing Director, BDO USA LLP
Lee Klumpp – National Assurance Partner, Nonprofit & Government Industries, BDO USA LLP
The Nonprofit Organizations & Foundations Seminar was later held on May 22nd. Our keynote speaker was the highly accredited Lee Klumpp, National Assurance Partner – Nonprofit & Government for BDO, out of the Washington, D.C. office. Lee discussed the latest trends and topics including tax reform and current accounting developments affecting the nonprofit industry.
With various changes occurring in the industry, we modified the format of the seminar by supplementing with two additional guest speakers. Following Lee’s presentation, Attorney Jeremy Cnudde, from KempKlein, spoke about Mergers & Acquisitions and Creating Value for Nonprofits. John Caldwell, Investment Specialist and Executive Director of J.P. Morgan Private Bank, discussed Key Principles of Effective Governance & Investment Management and Investment Policy Statements for the Current Environment.
Jeremy Cnudde – Attorney/Shareholder, KempKlein Law Firm
Based on the seminar feedback, we are pleased to announce that the attendees were overall satisfied with the new format! Stay tuned for future seminars!